Societies provide institutions that are costly to use, but able to enforce long-run relationships. We study the optimal decision problem of using self-governance for risk sharing or governance through enforcement provided by these institutions. Third-party enforcement is modelled as a costly...

This essay analyzes the three papers presented on a panel I organized as chair of the AALS Antitrust Section entitled Evolving Antitrust Treatment of Dominant Firms for the 2005 Annual Meetings. Steve Salop’s and Doug Melamed’s papers recommend standards for government intervention while...

This paper studies an economy where agents can spend resources on consuming a private good and on funding a public good. There is asymmetric information regarding agents' relative preference for private versus public good consumption. I show how private good consumption should be coordinated...

There is a general presumption that social preferences can be ignored if markets are competitive. Market experiments (Smith 1962) and recent theoretical results (Dufwenberg et al. 2008) suggest that competition forces people to behave as if they were purely self-interested. We qualify this view....

There is a general presumption that social preferences can be ignored if markets are competitive. Market experiments (Smith 1962) and recent theoretical results (Dufwenberg et al. 2008) suggest that competition forces people to behave as if they were purely self-interested. We qualify this view....

This paper studies a partial-contracting model where an agent may provide effort to increase a project’s scope before some later decisions have to be taken. Consistent with existing empirical evidence, we find a positive relationship between exogenous risk and delegation. That is, we show that...